Delivering Precincts via effective market engagement

BACKGROUND

Large-scale regeneration programmes often operate under comprehensive frameworks aimed at long-term, successful urban revitalisation. These programmes typically involve redesigning neighbourhoods, revitalising local centres, upgrading public amenities, and providing healthy homes.

Such programmes generally align with a number of strategic outcomes for central and local government, including:

• Delivering affordable housing in an environment of constrained supply
• Improving the well-being of public housing tenants while addressing the renewal liability attached to existing housing stock
• Improving amenities, community infrastructure, and connectivity in a way that benefits the wellbeing of all residents
• Building Community resilience.

The business case for such programmes identifies key Investment Objectives and anticipated Benefits, such as:

• Better Housing choices
• Housing quality is future-proofed
• Safer neighbourhoods with high quality amenity
• Prosperous and Resilient Economy and Community

These objectives are generally reflected in Master Plans:

• Collaboration and Partnership underpins delivery
• The area should be recognised as a great place to live
• Community-specific outcomes must be prioritised
• Health and Wellbeing outcomes must be enhanced
• Ecological and Environmental restoration are priorities
• A range of housing options must be made available to the community
• Infrastructure and service delivery must address community and environmental needs
• High quality education must be available locally
• Economic wellbeing should be advanced through transition and diversification into new sectors
• It should also leverage a creative and inclusive community

If we are doing a good job, we might even create an Outcomes Monitoring and Evaluation Framework that includes key performance indicators for each objective.

However, we very rarely deliver on all of the above, and in many instances we don’t deliver on very much at all. Why not?
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TURNING INTENT INTO A PARTNERSHIP FRAMEWORK

Regeneration programmes involve a significant number of stakeholders across central government, local government, iwi, community groups, not-for-profits, service providers, and the private sector. These are usually identified in stakeholder and governance maps within strategic documents.

However to effectively engage the collective interests, resources, and ambitions of this stakeholder group, a Communications and Engagement Framework is usually used. This is predicated on the idea that effective stakeholder engagement is a ‘whole of project’ commitment, often built off existing successful precedents. This framework is effective in driving the programme through the initiation, definition, business case, and framework planning phases.

However…

A common challenge for large-scale regeneration programmes is the transition of approved BC's, Master-plans and Strategic Frameworks into effective implementation (i.e. built outcomes and happier people that earn more because we have grown the economy and created opportunity). In a business case sense, this is where the Strategic, Economic, and Financial cases conclude, and the Commercial and Management cases begin. The emphasis also shifts from Stakeholder Engagement to Market Engagement, even as effective communication remains a critical component of the overall work program.

Where area-based Projects have access to land, funding, and regulatory powers, the ability to manage this change from defining and enabling outcomes to pursuing outcomes can be relatively seamless. While effective and efficient market engagement is still critical in managing process, development, and delivery risk, this is easier to achieve when presenting as a single client. Maintaining strong alignment with those stakeholders identified as key delivery partners in the implementation phase is also crucial.

In areas where the implementation plan relies on a multi-agency, multi-disciplinary framework seeking to unlock aligned and coordinated decisions and actions across the public, private, financial, community, and household sectors, the challenges are much greater. Governance arrangements may reflect a commitment to programme outcomes but often grapple with decisions made in an individual entity context, with distinct decision-making processes, information sets, and competing priorities.

External factors, such as unprecedented economic impacts (e.g., negative shocks to incomes, demand, and supply chains), can amplify these challenges.

However, as economies move through various stages of recovery and re-opening, it often becomes clear that the Public Sector will have a stronger presence. In doing so, it will also hold a much stronger risk profile, as evidenced by economic, monetary, and financial policy responses.

Within this scenario, it is critical that the Public Sector also provides itself with exit strategies. Over time, it is important that the private and community sectors re-establish themselves at the heart of the economy. Developing those exit strategies requires a strong partnership framework.
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THE PARTNERSHIP PLAN

The concept of stakeholder engagement as a ‘whole of project’ concept provides for varying degrees of participation as the regeneration programme moves from initiation to delivery. If a key principle of engagement is aligning stakeholders around a common vision and strategic objectives, then the intended outcome is not just strengthening the value proposition, but also the willingness to pay.

A Partnership Plan represents the point at which an initiative becomes transactional. This is essentially where the intention is to transition from participation to commitment – across all forms of financial, natural, social, human, and manufactured capital. It is also intended to ultimately take a contractual form, which requires a clear strategy, process, and commitment of resources to achieve that. The impact cuts across the organisation in three ways:

• Strategic – the ability to seek solutions; reconcile dilemmas; innovate and develop new business ideas
• Operational - identify emerging issues; a clear understanding of pressure points; access external expertise
• Risk – be conscious of reputation risk and the social license to operate; explore opportunities for cost mitigation, conflict mitigation, and regulatory efficiency

The complexities of a large-scale regeneration program are often reflected in existing commitments by public development entities to work in partnership with developers, indigenous groups (where applicable), local and central government, community housing providers, and non-profit organizations to achieve their public housing and development roles. Such entities also seek to support industry transformation and leverage private sector expertise, capability, and investment, particularly when delivering affordable and market-priced housing.

In terms of what a public development entity brings to the table in enabling successful long-term regeneration, it typically commits to:

• Coordinate the urban development work of multiple agencies
• Support others to take the lead on urban development projects
• Unlock investment for urban development projects
• Take a lead role in delivery itself, for example, where projects are particularly complex.

A Partnership Plan is intended to sit alongside existing Stakeholder, Communications, and Marketing strategies but with the intention of migrating participation into commitments. This will include looking to engage counterparties who may not have had visibility of the Programme during the Project Definition and Approvals phase.

The key objectives of such a Plan are to:

• Identify the opportunities of the regeneration programme which require strategic partnerships
• Identify the key goals for those partnerships in enabling a co-ordinated implementation of the regeneration plan
• Identify what steps are required to secure the level of commitment from each partner, and the form of that commitment
• Commence the process of engaging with the wider market on the Project, enabling market participants to consider potential opportunities, risks, and solutions that will ultimately lead to improved outcomes.

The Regeneration Framework identifies the key principles and commitments under which the programme's Strategic Partners have agreed to work together.

Over time, the nature of those commitments will become more granular. This includes those sought from public sector entities, landowners, the financial sector, developers, businesses, asset investors, and ultimately individual households. The process of advancing that will involve degrees of complexity but with the overarching intention of both confirming the partners’ respective commitments and informing the market of intentions in order to develop solutions together.